For the week, CSI300 was up 0.5 percent, while SSEC added 0.2 percent.

Over the weekend, Premier Li Keqiang said China would strike a balance between financial stability, gradual deleveraging, and steady economic growth, noting the government was capable of maintaining stability in the financial markets.

The market had posted five consecutive weeks of declines on concerns over Beijing’s stepped-up campaign against shadow banking and that efforts to de-leverage could sap liquidity and hurt the economy.

In an apparent effort to settle market nerves, China’s banking regulator said risks in the banking sector were completely controllable, and the market did not have to be nervous of scrutiny.

However, according to most analysts Reuters spoke to, market sentiment remains fragile and investors are expected to be cautious, with some saying de-leveraging remains the direction of Beijing’s policy despite soothing regulatory rhetoric.

Investors are also worried that China’s economy could witness renewed slowdown as a recovery - triggered mainly by government stimulus - peters out, said Yang Hai, strategist at Kaiyuan Securities

Indeed, an official survey published this week showed Chinese stock investors’ confidence fell for a second straight month in April, to the lowest in seven months, dented by economic concerns.

For the week, consumer stocks outperformed among main sectors, with the index tracking those stocks rallying 4.7 percent in its best week in 10 months, while banking stocks dragged the most. ($1 = 6.8921 Chinese yuan) (Reporting by Luoyan Liu and John Ruwitch; Editing by Jacqueline Wong)